October 19, 2017 - From the October, 2017 issue

Subnational Climate Action: Sec. John Kerry, Gov. Jerry Brown, & Others Call for Leadership

In September, the Kerry Convening at Yale brought together individuals on the front lines of addressing climate impacts. In this excerpted panel, moderated by Sec. John Kerry, California Governor Jerry Brown, Washington Gov. Jay Inslee, President of the World Bank Dr. Jim Kim, and Mayor of Paris Anne Hidalgo all outlined how they addressed the vacuum of leadership in Washington D.C. TPR presents an excerpt of the panel, which featured Gov. Brown (pictured here) speaking about the role of clean energy investments and the state’s cap-and-trade success. As discussed by Gov. Brown, Dr. Kim and Sec. Kerry, there is an increasing use of finance instruments that create revenue streams by reducing emissions and are directly reinvested in the local economy.


Governor Jerry Brown

"To paraphrase John F. Kennedy, I think we can say of this moment that the torch is being passed to a new generation—tempered by the harsh and bitter science that demands we all act—and unwilling to witness or permit the slow erosion of the atmosphere that sustains human civilization and all we hold dear." - Washington Governor Jay Inslee

John Kerry: There is a solution to climate change, and it’s here now: It’s called energy policy. If we were to implement the right choices with respect to wind, biomass, solar, and so forth, there’s an enormous amount that we could do, and move much faster on.

This panel represents real decision-making by governors, mayors, and the head of the World Bank, which has enormous leverage in its ability to create change on a global basis. Let’s begin with Governor Inslee.

Jay Inslee: To paraphrase John F. Kennedy, I think we can say of this moment that the torch is being passed to a new generation—tempered by the harsh and bitter science that demands we all act—and unwilling to witness or permit the slow erosion of the atmosphere that sustains human civilization and all we hold dear. But the torch of leadership has also been passed from the White House, where we would like it to be, to other leaders—to governors, to mayors, to individuals, and to college students. We all need to pick up the torch that has been dropped by the current occupant of the White House, and hold it as high and bright as we can.

The good news is that governors are picking up that torch. States are powerful in this regard. Within 36 hours of the president bailing on the Paris Agreement, we had stood up with a new organization called the United States Climate Alliance. The alliance now has 14 states, who have pledged and shown their teeth on policies to decarbonize our economy. Our alliance represents 40 percent of the United States’ economy, and we can legitimately tell presidents, prime ministers, and mayors around the world: The United States is not bailing on this effort. The United States is acting.

I have imposed a cap limiting the amount of carbon pollution that is damaging my state, to guarantee Washingtonians that they won’t be strangled by carbon dioxide. This is the first executive order in the United States to cap that through a regulatory, concrete, enforceable, lawful means. We also have a clean energy fund, which has developed a company with the largest vanadium-flow grid-scale battery in the world today. We’re moving; help is on the way. 

John Kerry: The President of the United States may have decided to pull out of the Paris Agreement, but the people of the United States remain committed. In my judgment, we are going to not only meet the Paris Agreement, but exceed it. We are already more than 50 percent of the way there.

What Paris did was send a message to the marketplace that they’ve got to start investing and changing. Since then, we have doubled the amount of money being invested in alternative renewable energy over the amount that’s going into fossil fuels. For the first time in American history, more money is going into alternative renewable energy than into fossil. That’s in many ways the product of the work of governors, and, on the grassroots level, mayors. Paris Mayor Anne Hildago chairs C40, an organization made up of cities around the world, and she’s going to share how important it is for cities to take the lead. 

Anne Hidalgo: I believe that cities are the right level at which to act to fight climate change. Cities are democracy at the human level. In cities, we can build strategies and alliances with the private sector, citizens, and NGOs who know that we have to act now. Cities are also agile; we have more agility than states and nations.

Today, we have a community of the mayors of cities from around the world who share the same vision and commitment to fighting climate change. Our network, C40, actually now has 91 cities, including some of the biggest in the world. We represent 650 million people around the world, and 25 percent of the world’s GDP.

The network includes a lot of American cities—in California, in New Orleans, Illinois, New York, and more—that are united in this fight. It also includes NGOs and international institutions. We share experiences, and use one another’s experiences to inform policies in our own cities. This helps us be more effective and more efficient in our climate action—which is important, because we don’t have time to wait around.

Fighting climate change brings new opportunities in business, markets, and employment, as well as in the democratic governance of our communities. Our power will come in being both visionary and very concrete.

When we heard the President of the United States talk about leaving the Paris Agreement, we couldn’t believe it. But we are a majority on this planet who think that we need to act today. And together, we are very powerful—more powerful than the President of the United States.

John Kerry: Jim Kim has taken the World Bank into modernity by refocusing its approach to financing and stimulating investment in the right areas. That was central to our ability to get the Paris Agreement done, among other things.

Jim Kim: It’s crazy to me that there is a debate about climate change in the United States. In most of the developing countries around the world, the awareness of this issue is intense. There is not a single African head of state who is not convinced that climate change is real. They often say: “You in the rich world debate climate change. We in Africa have the boot of climate change on our necks.”

Lots of good things are starting to happen now, including the Paris Agreement. But I still worry, because the fact is that the nationally determined contributions that came out of Paris will not keep us under 2 degrees Celsius. The next step after Paris is making sure that all the great declarations actually get made into deals that transform our ability to invest in mitigation and adaptation.

Around the world, over the next 15 years, there will be $90 trillion investment in infrastructure. That represents more infrastructure investment than there has been in the entire history of the world prior to that point. And 70 percent of that investment will be in cities. The question is: Will there be enough financing to make sure that all this infrastructure investment is climate-smart? Will we be using bus rapid transit? Will we be using electric cars? Will we increase the density of cities to reduce their carbon footprints? Right now, the answer is “not yet”—because the financing is not available.

In India, Prime Minister Modhi has a huge ambition to move away from coal to solar energy. The problem is the cost of capital. It’s a question of whether we can find the financing to keep up with Prime Minister Modhi’s ambitions. Leaders of other countries, including major emitters—like Indonesia, Vietnam, Pakistan, and the Philippines—also want to move toward low-carbon energy and cleaner solutions, but don’t have access to capital to make those investments and find that financing is not available.

Advertisement

Financing is the major blockage to global climate action right now. But there is also a fantastic opportunity. More than $10 trillion is sitting in negative interest rate bonds. Another $20 trillion is sitting in government bonds earning very little—usually less than 1 percent—interest. And another $8 trillion or so is sitting in people’s safes in thousand-Euro bills. Across that $40 trillion, everyone is looking for higher return.

At the World Bank, we’re using every single tool we have—and this is debt instruments, where we take first loss, that reduces the risk for the others who are investing; we have political risk insurance; we have credit enhancement that will be used when countries promise to a private provider of solar, for example, to make the payments every month or every year, but sometimes they get in trouble. We can step in and provide a kind of insurance and we’ll make those payments.

At the 2009 Copenhagen meetings, the World Bank Group was not allowed into the room, because we were the “bad guys” on the climate change issue. This year, not only were we in the room, but we pledged to get to $30 billion a year by 2020—and we’re going to get there. We’re going to be the largest funders of climate change activity in the world. But it’s still not enough.

Secretary Kerry joined us last April to form Invest for Climate, which brings together investors, climate change specialists, leaders of countries, and multilateral development banks. This is what has to be done, and we are committed to pushing in that direction.

John Kerry: In direct contradiction to what President Trump said—that he was “putting America first” by pulling out of Paris—in effect, he’s putting us last. He has lost us momentum and credibility, and taken us out of the process that will determine the future marketplace. Our businesses will suffer as a result of the decision the president made, because other countries don’t believe we’re serious.

The energy marketplace is the largest market the world has ever seen. There are 5 billion users today, and that will grow to 9 billion users over the next 20 years. People buy energy; they buy water; they buy transportation. It’s revenue-producing, which means you can expect a return on investment, and yet we’re not moving aggressively into that marketplace.

Governor Brown has set an example in the state of California. Free-standing, California is the sixth largest economy in the world. When California decides to do something, it has an impact on the rest of the country and the rest of the world. To wit, when California sets automobile standards, the automobile industry has to listen. That’s the impact California has. Governor Brown has made California a model for how governors and states can make a difference.

Jerry Brown: We are moving in a positive direction. I was in Rio in 1992, when the Framework on Climate Change was adopted, and nothing much happened. I was in Johannesburg in 2002, and nothing much happened. But Paris was a real commitment. As far from the ultimate solution as it is, it’s a long way from where we were just a few years before.

It was only a couple of years ago when the press barely mentioned climate change. I would have press conferences with scientists announcing relevant and important achievements or ideas, and there would be zero press. But now, with the Paris Agreement, that’s changed.

We still have a long way to go, and we have a lot of barriers ahead. To me, the threat is a political one. Why can’t we deploy all this money Mr. Kim talked about? Because of politics. And what are the politics? Well, we have a bunch of troglodytes in high places. A troglodyte is a dweller of deep, dark caves, and that is a metaphor for the level of enlightenment of those in charge of our political structure in Washington today.

It starts with Trump, but it’s also EPA Director Scott Pruitt, who is doing everything he can to destroy and dismantle the modest steps that were taken under President Obama. He’s going full speed in the absolute wrong direction. It’s also Oklahoma Senator Jim Inhofe, who’s on the Environment Committee. And of course, it’s the President of the United States asserting that all climate science is a Chinese hoax.

All this didn’t come about just because Trump thought it up one day. There are companies promoting this propaganda, and institutes—like the Hartland Institute, the Kato Institute, and other respectable foundations—spewing total fabrications about one of the most important issues of our day, which are then picked up and disseminated right out of the White House. That’s the intellectual environment we’re up against. We have to destroy this mythology that is based on nothing. Through elections, through writing, and through encouragement, we can shift the political center of gravity.

But there are real solutions, and we’re finding some of them in California. We had eight Republicans in our state legislature vote for the most far-reaching cap-and-trade bill in the country. The system has now been embraced in California by the Farm Bureau, the Chamber of Commerce, the Business Round Table, and by significant industries, plus most of the Democrats and key Republicans.

We have a limit on greenhouse gas emissions within the state, with significant enterprises reporting, and third-party validators who check on the reports. We currently emit approximately 440 million tons of greenhouse gases per year; we have a target of 260 million tons per year by 2030. Each year, the gap from where we are today is going down. This is an operational, legal framework that is now working in my state, and that could be done in other states.

We also have auctions under this system. Last month, we collected over $1 billion from companies buying allowances because they couldn’t meet the cap. Every year, those allowances will get more expensive. And that billion dollars is money we spend: We’re paying people to buy electric cars. We’re spending tens of millions of dollars in dairies to get biodigesters that reduce methane emissions. We are taking very specific actions with real money and with real law enforced by the authorities of California.

We know this can be done, but we need other states to pick it up. While we’re waiting for the president to come back to reality, there’s a lot we can do. There’s a lot that universities can do, and non-profits and think tanks. It’s politics, it’s science, it’s intellectual investigation, and it’s financing, all together. The knowledge is here; the solution is at hand; all you have to do is get it done.

<

Advertisement

© 2020 The Planning Report | David Abel, Publisher, ABL, Inc.